Financial abuse of the elderly is one of the most insidious betrayals. Often, seniors are taken advantage not by strangers, but by the very people they trust: neighbors, friends, and family.
What is financial abuse of the elderly? According to Consumer Reports, it is the illegal or improper use of assets belonging to people aged sixty and older. Financial abuse includes telemarketing scams as well as exploitation by caregivers. Trusted caregivers have written checks to themselves, stolen Social Security checks, convinced seniors to sign over the deed to their house, and otherwise stolen money and other assets.
Unfortunately, financial abuse of seniors is on the rise in the U.S. The elderly are particularly vulnerable for a number of reasons: they are of the age where they have accumulated wealth, they are less likely to report fraud, and they may have cognitive issues that prevent them from recognizing that they have been the victims of a crime. Often, financial abuse goes unreported.
Fortunately, there are a number of things you can do to protect yourself, or to help protect your parents:
Hire trusted professionals. A certified public accountant (CPA) or financial planner can help you determine how much money you can safely withdraw from retirement accounts. A Dayton, Ohio estate planning attorney with experience in elder law can help you write your will and power of attorney documents. He or she can also create a trust, which can limit relatives’ access to your assets. A daily money manager can help you manage your bills and insurance.
Draft a secure power of attorney document. You should have a power of attorney document, a legal document that gives a trustworthy individual access to your accounts should you ever become incapacitated. But be careful whom you give this power. Although this person is legally supposed to act in your best interests, he or she could, in reality, do anything with your money.
You should assign power of attorney to a person that you trust. But if you are worried that the power of attorney may be abused, you can include limits in your document. For example, you can assign a relative or friend to monitor the person who has power of attorney. And you can assign joint powers of attorney. Your estate planning lawyer should hold on to the forms granting power of attorney so that the appointed person cannot turn them in early to your bank.
Manage your accounts. Set up your accounts so that any tax refunds, pension benefits, and Social Security checks are deposited directly. You can also set up automatic bill pay for your utilities, mortgage, and other expenses. Have your bank send statements and fraud alerts to a person you trust.
Check your caregivers. You should require that any caregiver undergo a national background check.
Secure your valuables. Keep jewelry and other valuables in locked drawers. In addition, don’t leave mail with identifying information in an unsecured mailbox.
For more information on preventing financial elder abuse, please visit the article by Consumer Reports.